Business-to-business (B2B) is when a business sells goods or services to another business. It’s the opposite of business-to-consumer (B2C) transactions.
Example B2B transactions:
- A store sells computers to another business
- An agency hires a freelance writer
- A mechanic repairs a company car
When we talk about VAT, a B2C transaction is a sale to another business that charges VAT. The VAT rules for B2B transactions are different from B2C transactions.